Most governments have some control over their economy either by regulations or controlling resources. However, there are many different regulations to do it. The United States and China are representatives of two different groups--capitalist and communist.
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In order to control the economy, the U.S. federal government regulates enterprise by either directly or indirectly controlling prices. According to the article Regulation and Control in the U.S. Economy, U.S. federal government “has sought to prevent monopolies such as electric utilities from raising prices beyond the level that would ensure them reasonable profits”. Government usually create regulations in order to directly controlling the economic system.
Those regulations can limit economic growth in some degree and the value of a dollar. In some cases, those regulations also help government to control the stability of the country’s economy. Furthermore, the article claimed the government will adjust the taxes in order to limit the market. When the government raised the taxes, there is less producer willing to produce because there is less profit. That will lead to the decrease in supply and the increase in prices of the good.
Those regulations can limit economic growth in some degree and the value of a dollar. In some cases, those regulations also help government to control the stability of the country’s economy. Furthermore, the article claimed the government will adjust the taxes in order to limit the market. When the government raised the taxes, there is less producer willing to produce because there is less profit. That will lead to the decrease in supply and the increase in prices of the good.
Different from the United State, Chinese government have the most of the control in the country’s economic system by mostly directly control. According to Economic Freedom Rating - china Compared to Continent, China has a high “level of government interference in the economy” and people has less “economic freedom”. In my opinion, it make sense because of the government structure. Chinese government is control by only one political group and if they lost control on the economic system, people may greatly affected by outside gossip and cause the economic system to be unstable. In another word, the economic system will fall and people will suffer. Also, Time magazine state “Foreign businesses in China are voicing growing frustration about the country's heavily regulated market — a bureaucratic maze many say is designed deliberately to hamstring non-Chinese players to the advantage of their local competitors”. In this report, reporter pointed out the Chinese government have used regulations to limit the effect of foreign business in Chinese economic system.
In my future blog post I will be addressing Taxes in detail.
a. The author did a good job taking the evidence from his articles and using it in a way that proved his point. Also he had a good compare and contrast style with finding differences between China and US.
ReplyDeleteb. The author can improve their writing in the next article by taking the quote and analyzing to tell the reader what it means, so his connection to his point makes a little more sense.
a. He used useful information regarding the two countries governments to address how they use regulations and ways they contrast one another.
ReplyDeleteb. To improve for future blog posts, the author can use a lead to draw readers attentions.